Others are no doubt just bored from being cooped up inside because of the pandemic. In others words, for some traders, Robinhood isn't just a cute brand name for a trading app – it's an ethos. Separating hedge funds from their money – the 99% against the 1% – by sticking up for shorted stocks such as GameStop is a stated goal. A number of WSB traders are openly motivated by a desire to profit at the expense of "The Man": the rich hedge funds and other institutional investors on the other side of the trade. What's striking in this case, however, is how many of them are trying to send a message. It's fair to assume that plenty of GME buyers are just looking to make a fast buck. "The massive short contributed more toward the meme stock." (A meme stock is essentially a cult stock.) WallStreetBets Wages War on the "Smart Money" "It was a meme stock that really blew up," a WallStreetBets moderator told Wired. At this very moment, WallStreetBets is working to ignite short squeezes in AMC Entertainment ( AMC (opens in new tab)), BlackBerry ( BB (opens in new tab)) and Nokia ( NOK (opens in new tab)), among others.īut nothing, so far, has taken off like GameStop. Lumber Liquidators ( LL (opens in new tab)) and Plug Power ( PLUG (opens in new tab)) have had price spikes in the past thanks to organized online buying. Once WallStreetBets alighted on GameStop, it was more like a pit bull with a pork chop.įor the record, this isn't the first time WSB has singled out a stock for crazy hype. To get a sense of its self-concept, WSB bills itself as "4chan with a Bloomberg terminal." The 21 Best ETFs to Buy for a Prosperous 2021Īs with the message boards of the 1990s tech boom, WSB is a place to swap trade ideas, juvenile jokes, threats and insults. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines. On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The collapse of the bank has resulted in increased short positioning in financial and banking stocks, while the premise of a massive short squeeze in GME because of SVB seems like a stretch. In fact, it seems more likely that GME will experience a short squeeze primarily based on short interest rather than the collapse of Silicon Valley Bank. BlackRock is the third-largest shareholder with 21.98million shares. 31, Vanguard owned 24.66 million shares of GME, making it the second-largest shareholder of the company. However, this doesn’t seem likely because SVB is a tiny portion of the two institutions’ portfolios. Shareholders have argued that Vanguard and BlackRock will be forced to hedge their positions by selling out of long positions and recalling short GME shares due to their losses in SVB. BlackRock owned 4.76 million shares, which accounted for 0.03% of its portfolio. 31, Vanguard owned 6.65 million shares of SVB, which accounted for a minuscule 0.04% of its portfolio. Others shareholders have pointed out that Vanguard and BlackRock (NYSE: BLK) are the largest shareholders of SVB, which could potentially benefit GME. Generally, a short interest above 10% is considered high, while a short interest above 20% is considered very high. That’s equivalent to a short interest as a percentage of float of 22.10%. 28, there were 56.85 million shares of GME sold short with a total value of $1.09 million. The connection between increased short positioning in financial and banking stocks leading to a short squeeze in GME is still up in the air.Īs of Feb. This has led to GME stock holders calling for a short squeeze.Īre Shorts going to be the Catalyst for the Mother of All Short Squeezes? Lol #GME #Gamestop /qzrQ5v6z5C Meanwhile, Goldman Sachs noted that “The ratio of bullish to bearish positions has fallen to more than an eight-year low.” While selling out of these positions, hedge funds also increased their bearish bets on banks. Last week marked the ninth-straight week of hedge funds selling off financial and bank stocks. However, GameStop (NYSE: GME) stock holders have grasped onto a silver lining. The rapid collapse of SVB Financial Group (NASDAQ: SIVB) subsidiary Silicon Valley Bank has shocked market participants, as the largest bank failure since 2008.
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